June 20, 2009 - Altria Group Inc.’s Philip Morris USA is introducing a new menthol version of its Marlboro cigarette this week that will compete with Lorillard Inc.’s Newport and Reynolds American Inc.’s Camel Crush (cigarette that contains a menthol capsule in the filter that provides flavoring when compressed).

Cigarette manufacturers shipped about 100 billion menthol cigarettes last year, or 28.6 percent of the total U.S. market, according to the Web site of Greensboro, North Carolina-based Lorillard. Menthol’s share has advanced for four straight years from 26.4 percent in 2004, according to the Web site. Total U.S. cigarette shipments dropped 3.4 percent last year, said Lorillard, the third-largest U.S. tobacco company. It says on its Web site it’s the biggest in menthol cigarettes with its Newport brand accounting for 33.7 percent of shipments in 2008. Marlboro’s menthol market share is about 18 percent, Phelps said. Philip Morris USA makes about half of the cigarettes sold in the U.S. It relies on Marlboro, the top-selling cigarette, to drive profit and market-share gains.

June 19, 2009 - Indonesia, the largest maker of clove cigarettes, may complain to the World Trade Organization about U.S. legislation that gives regulators expanded powers to regulate tobacco products, including possible bans on flavors such as clove but NOT menthol..

Indonesian Trade Minister: Mari Pangestu We’ll be having consultations,” said today in an interview on Bloomberg Television. “If we feel that this is treated discriminately, we’ll of course take it to the normal processes in the World Trade Organization (WTO).”

The Family Smoking Prevention and Tobacco Control Act bans clove but spares menthol.Indonesia - dispute with U.S. over banning the use of clove in cigarettes.. Menthols accounted for a quarter of the roughly 370 billion cigarettes smoked domestically in 2006 and are more popular here than anywhere else in the world. Menthol cigarettes have been linked to 14.6 percent of all African-American deaths in 2006. The next most popular flavored cigarette, clove, accounts for .09 percent of the market. Those cigarettes are banned under the bill. Indonesia, which provides 99 percent of the clove cigarettes to the U.S. market, has complained to the U.S. trade representative about the disparity with menthol. If Indonesia brings a protectionist complaint to the World Trade Organization, it would compel the U.S. government to prove cloves were banned for health reasons. Namely, the United States would have to show that the flavor of cloves enhances cigarettes’ addictive properties. If it can’t, the ban could be considered a trade violation.

The legislation, which was approved by the House of Representatives and Senate earlier this month, offers a concession on menthol, the most popular flavored cigarette in the U.S. Pangestu’s comments reiterate Indonesian objections made last month.

“We feel this is discriminating against cloves because menthol is not considered,” Pangestu said today from Jakarta, the Indonesian capital. Cloves, native to Indonesia, are a spice taken from the dried flower buds of a tropical tree.

Indonesia exports about $500 million worth of clove cigarettes, known as kreteks, a year, according to Sudjadnan Parnohadiningrat, Indonesia’s ambassador in Washington. About a fifth of the shipments go to the U.S., and Indonesia says its cigarettes make up 99 percent of the U.S. market for the product.

Pangestu said in May that a ban on kreteks would hurt Indonesian clove farmers and violate WTO rules. The Southeast Asian nation has about 4 million clove farmers.

To contact the reporters on this story: Naila Firdausi in Jakarta at nfirdausi@bloomberg.net; Haslinda Amin in Singapore at hamin1@bloomberg.net

Kretek (pronounced /ˈkriːtɛk/) are cigarettes made with a complex blend of tobacco, cloves and a flavoring 'sauce'. The word "kretek" itself is an onomatopoetic term (the formation or use of words such as buzz or murmur that imitate the sounds associated with the objects or actions they refer to.) for the crackling sound of burning cloves.

June 19, 2009 - The average fine for handling illegal cigarettes was just €423 (592USD) during the first three months of the year, new figures reveal. The paltry size of the fine last night prompted calls to end Ireland's reputation as a cigarette smugglers' paradise. The tobacco industry is among those who want stiffer penalties imposed on smugglers and sellers of illegal cigarettes.

A breakdown of the revenue statistics reveals that Dublin, Louth and Kerry top the list for cigarette convictions. Penalties were imposed in 11 counties, with 43pc of convictions recorded in Dublin, 11pc in Louth and 8.5pc in Kerry, while the rest were divided between Clare, Wexford, Limerick, Galway, Kilkenny, Cavan, Waterford and Kildare.

The manufacturers said last night the figures showed the geographic spread of the market for the smuggled cigarettes, which were estimated by the authorities to cost the Exchequer €500m (700 millionUSD) every year in lost revenue. The total combined hauls of cigarettes confiscated at Dublin airport alone since the start of the year has reached more than 13 million. A spokesman for the Irish Tobacco Manufacturers Advisory Committee said: "This evidence highlights that, with continued insufficient penalties, Ireland will remain a smugglers' paradise".

Some interesting facts: Tobacco kills eight persons around the world every minute. Each year, more than five million people around the world die from tobacco-related illnesses. By 2030, the figure will be 20 persons per minute, with most of these deaths taking place in the developing world. Unfortunately, many developing countries provide a conducive atmosphere for tobacco companies to test their latest insidious tactics to get around strict legislation in developed countries.

Aggressive marketing by tobacco companies has contributed to the rise in new smokers. Tobacco companies spend in excess of $5b a year on marketing and promotion in the US. Targeting women and youth, cigarette advertisements directly associate smoking with being slim.

June 19, 2009 - Papua New Guinea’s (PNG's) tobacco industry says its under threat from counterfeit tobacco products, which are allegedly being smuggled into the country from Indonesia.Police say the counterfeit cigarettes are being sold openly in local markets and on the streets. PNG’s cigarette maker and distributor, British American Tobacco says the counterfeit cigarettes have been packaged to look like leading brands and has warned smokers to be more vigilant. They say their sales and revenue are being threatened by the development, which could eventually destroy the local markets. The police inspector for Sandaun province, Sakawar Kasieng, says they believe the cigarettes are made in Indonesia and are being smuggled into the country on boats crossing the mostly unguarded sea border between PNG and Indonesia.

June 18, 2009 - California - in their effort to eliminate a $24-billion budget shortfall, the state’s politicians are discussing dismantling California’s main welfare program, eliminating the health insurance program for poor children and decimating education without any apparent debate on raising the income or sales tax.

One of the few state taxes that politicians have talked about raising is the tobacco tax. California’s is currently set at 87 cents a pack (and hasn’t been raised in a decade); this year, the Legislature will consider raising it to $2.97 a pack, which would bring the cost of a pack of cigarettes to more than $7. Sponsors of the bill estimate that the tax hike would raise about $2 billion.The tobacco tax is a good tax. They raise revenues and simultaneously serve the public good by reducing smoking, at least in theory. That’s not insignificant in a state where about 13.3 percent of residents smoke, where there are more than 30,000 smoking-related deaths each year, and annual smoking-related costs are estimated at more than $15 billion.

Raising tobacco taxes can change behavior. The tobacco tax is based on one of the most fundamental rules of microeconomics — the law of demand — which says that all else being equal, the more you raise the price of a product, the more demand for it will drop. Conversely, if you reduce the price, more people will buy, use or, in this case, smoke the product.

Reynolds American Inc. said North Carolina Governor Beverly Perdue is putting manufacturing jobs at risk with her proposal to raise cigarette taxes by $1 a pack. “We want more jobs, not taxes,” Daniel Delen, chief executive officer of Reynolds’ R.J. Reynolds Tobacco Co. unit, said today during a rally in Raleigh, North Carolina’s capital. “Taxes cause direct job losses.” More than 400 Reynolds employees wearing yellow T-shirts emblazoned with “NC Needs More Jobs Not More Taxes” gathered to urge legislators to reject raising cigarette taxes in the state that grows the most tobacco in the U.S. and is home to Reynolds and Lorillard Inc.Legislators resume negotiations this week on slashing the state budget that takes effect July 1. A compromise to be hashed out among House and Senate members may include a “small increase” in cigarette taxes after the House last week passed a budget with no increase. The plan to raise cigarette taxes reflects that “we simply need revenue,” Perdue, a Democrat elected in November, said in an e-mailed statement. Despite legislative opposition, she said, “we have to be direct and upfront about the costs of health care directly tied to the use of tobacco.”

North Carolina (with a budget gap of more than $4 billion) is one of at least 25 states where legislators are considering an increase in cigarette taxes to cover budget shortfalls, according to the Web site of the National Conference of State Legislatures. (Tobacco tax increases still appealing...)

June 17, 2009 - London-based British American Tobacco (BAT), the world's second-largest cigarette producer by sales after Philip Morris International Inc. (PMI), said on Wednesday, June 17th it had acquired a majority stake in an Indonesia clove cigarette maker, Bentoel Internasional Investamal (BII) for $494m, as the company seeks growth in emerging markets to offset slowing sales in mature economies.

BAT said that it has bought 85% of Bentoel from the Indonesian Rajawali Group and other shareholders for 4 million. Separately, Rajawali confirmed that it sold its entire 56.96% stake in Bentoel. BAT hopes to complete a tender offer for the remaining shares by the end of August.The deal, which values BII at $580m, would allow BAT to enter Indonesia’s big kretek market, or clove-flavoured cigarettes that are consumed by nine in 10 Indonesian smokers.

Philip Morris International, BAT’s main rival, is the Indonesian market leader with about 29 per cent of the estimated 230bn kretek sticks sold last year, mainly through its Sampoerna unit, which it bought for $5bn in 2005. It is followed by Gudang Garam and Djarum, two local companies that control 21.1 per cent and 19.4 per cent of the market, respectively.

Ben Stevens, BAT’s finance director, said there could be further room for consolidation given that the deal would lift BAT’s market share by volume in Indonesia only from 2 per cent to 8 per cent, leaving it a small operator in the world’s fifth-biggest tobacco market. He said 8 per cent was still a small market share and BAT would like to increase that. “If another acquisition opportunity comes up we would certainly not rule it out.”

Government officials acknowledge the long-term cost of its policies is likely to be greater than the short-term gains, but are conscious that harming the interests of millions of people employed in the industry could be politically damaging.

June 17, 2009 - Bill C-32 is an amendment to the Health Canada Tobacco Products Control Act (effective January 1989) proposes to ban the sale of all small little cigars and flavored tobacco.

But Kentucky tobacco growers contend the legislation has been written so broadly it could also bar American-blend cigarettes that include burley tobacco, which they say has flavoring added during normal processing to mitigate its naturally harsh taste.Representative Ed Whitfield, a Kentucky Republican congressman,wrote to Canadian International Trade Minister Stockwell Day that Bill C-32 exceeds its goal to prohibit the marketing of candy-flavored cigarillos to Canadian youngsters. In a June 5 letter to Day, quoted by the CanWest News Service, Whitfield said, "It bans the manufacture (both for domestic consumption and export) and the sale of all American-style cigarettes in Canada. This bill would thereby ban the vast majority of U.S. Cigarettes to Canada."

Whitfield and fellow Kentucky congressman Brett Guthrie have told Day they believe the anti-tobacco bill will "violate several trade agreements including the Technical Barriers to Trade and North American Free Trade Agreement."Canadian Health Minister Leona Aglukkaq announced the proposed amendment to the Tobacco Act on May 26. She said in a statement then that the revision seeks to make tobacco products less affordable, less accessible and less appealing to Canada's young people. Health Canada spokesman Christelle Legault pointed out American-style cigarettes make up only 0.5 percent of the total value of the cigarette market in Canada.

In a June 8 letter to Day, Canadian Manufacturers and Exporters President Jayson Myers said Bill C-32's ban on numerous additives and cigarette ingredients will produce "unintended consequences" unless it is amended before passage. "Additives are essential in the making of any cigarette and American blend cigarettes are among the most common in use," Myers said. "The government needs to ensure that it avoids protectionism in the midst of this economic downturn as this will lead to more jobs lost in Canada."

Legault: "American-style cigarettes are made by blending different tobaccos with flavoring preparations (called casings), sugars and sweeteners to enhance their taste. The intent of Bill C-32 is to prohibit the use of flavorings, except menthol, and appealing additives in all cigarettes. We know that the addition of flavours and additives makes them more appealing to youth and this is exactly the kind of tobacco industry marketing tactic that we want to prevent in order to protect our vulnerable youth."

"The legislation is currently being discussed at the health committee of the House of Commons," Leclerc told Canwest News Service. "We are aware of the concerns expressed by the two members of the U.S. Congress."

The Family Smoking Prevention and Tobacco Control Act bans clove but spares menthol.Indonesia - dispute with U.S. over banning the use of clove in cigarettes.. Menthols accounted for a quarter of the roughly 370 billion cigarettes smoked domestically in 2006 and are more popular here than anywhere else in the world. Menthol cigarettes have been linked to 14.6 percent of all African-American deaths in 2006. The next most popular flavored cigarette, clove, accounts for .09 percent of the market. Those cigarettes are banned under the bill. Indonesia, which provides 99 percent of the clove cigarettes to the U.S. market, has complained to the U.S. trade representative about the disparity with menthol. If Indonesia brings a protectionist complaint to the World Trade Organization, it would compel the U.S. government to prove cloves were banned for health reasons. Namely, the United States would have to show that the flavor of cloves enhances cigarettes’ addictive properties. If it can’t, the ban could be considered a trade violation.

June 17, 2009 - While one branch of the New Brunswick(#3) government has been suing large tobacco companies, another branch has $21 million invested in them, investment records show.

The records released last week by the New Brunswick Investment Management Corp. show heavy investments in Imperial Tobacco, Rothman's, British American Tobacco, Philip Morris, its parent company Altria Group and R.J. Reynolds. The government pension funds have also invested in other tobacco companies, but those are not part of the lawsuit.

The provincial government agency that manages the pension funds of public servants, teachers and judges, had holdings in those companies worth about $21.2 million on March 31, 2008.

Organizations such as the Canadian Cancer Society, the Canadian Medical Association, and Physicians for a Smoke Free Canada question the appropriateness of public pension investments in tobacco interests. Ellen Snider, a spokesperson for the New Brunswick branch of the Canadian Cancer Society: "I don't think the government has any choice but to take a close look at this and to consider the possibility that absolutely those [investments] have to be pulled, absolutely."

June 16, 2009 - Philip Morris USA will continue to grow its product reach this week with the beginning of a test market for the new L&M roll-your-own (RYO) tobacco product. Tobacco delivery of pouches and canisters of the new product to retailers in Maine and Michigan begins this week as a test markets.

Philip Morris USA to test L&M Roll-Your-Own-Tobacco..

Although Philip Morris USA (PM USA) spokesperson Greg Mathe would not say how many retailers are adding the two SKUs beginning tomorrow, he did say, "We're trying to get it into enough stores to gain some insights into the category."

The test is part of PM USA's continuing effort to expand its tobacco product offerings, Mathe told CSP Daily News in an exclusive interview."Philip Morris has had a growth strategy, and it's looking at growing adjacent categories," Mathe said." Cigars are growing, MST [moist-smokeless tobacco] is growing, and roll-your-own is growing about 11% a year. Although it's a fairly small segment of the tobacco category, it is growing. So this is our chance to learn about the category, to learn about the segment and see how adult smokers respond to this type of product."

The product is available to all channels of retail in the test markets in 0.75-oz. pouches and 6-oz. Sta-Fresh canisters. Mathe said price points will be "comparable to other roll-your-own products in the market place" and extend from the recent refresh of PM USA's L&M cigarette brand.

"About two years ago in the Midwest and West, L&M [cigarettes] got a refresh and a greater focus from Philip Morris. We redesigned the contemporary value brand to a similar price point as our Basic product," he said. "Then over the past two years, that's slowly rolled out to more and more regions across the country. So really we feel that brand and its position as a manufactured cigarette can translate well within the roll-your-own segment."

June 16, 2009 - The Virginia Commonwealth University (VCU) Center on Health Disparities, in partnership with the City of Richmond Department of Social Services Healthy Start Initiative, is launching a new media campaign to help pregnant women stop smoking.

“One Tiny Reason to Quit” will encourage expectant mothers to get information and support about smoking cessation by calling a toll-free number, 1-800-QUIT-NOW (1-800-784-8669).

The launch of “One Tiny Reason to Quit” is on Wednesday, June 17, at 11 a.m. in the auditorium at Pine Camp Arts and Community Center, 4901 Old Brook Rd. Media should arrive between 10:35 a.m. and 10:50 a.m. Representatives from VCU Health System, City of Richmond Department of Social Services Healthy Start Initiative, Richmond City Health District and Virginia Department of Health will explain the campaign and answer questions.

Richmond has one of the highest infant mortality rates in Virginia, according to the Virginia Department of Health. The infant mortality rate among African Americans is especially high. In 2007, 36 of the 41 infant deaths reported in Richmond were African American infants.Altria Group parent of Philip Morris USA, the largest U.S. tobacco company is now headquartered in Richmond, VA..

Smoking during pregnancy is one of the most significant behavioral causes of infant mortality. The “2001 Surgeon General's Report: Tobacco Use and Reproductive Outcomes” estimates eliminating maternal smoking could lead to a 10 percent reduction in all infant deaths and a 12 percent reduction in deaths from perinatal conditions.

“One Tiny Reason to Quit” is funded through a research grant from the National Center for Minority Health and Health Disparities in response to the heightened infant mortality statistics in the City of Richmond and the disparities in rates between African Americans and whites.

June 16, 2009 - Sometimes when you get what you want, you also get some unintended consequences.

The Family Smoking Prevention and Tobacco Control Act once signed by the president would give the Food and Drug Administration (FDA) far more control over the cigarette industry—to curb advertisements, require stronger warning labels, and potentially even outlaw sales of tobacco products in certain locations and in vending machines.

But the bill is not without its consequences—and one of them is a likely hit to the budgets of many states, which count on tobacco tax revenue to fund their budgets. In fact, after a huge tobacco Master Settlement Agreement in 1998, the tobacco companies agreed to pay more than $200 billion to the states to cover health care costs. Many states actually sold bonds on which interest would be paid out of anticipated tobacco tax revenues.

Because these states have essentially borrowed against future payments from the tobacco industry, they are now dependent on the continued vitality of cigarette sales. If Big Tobacco stumbles, as a result of the FDA restricting sales states will be on the hook for these massive, billion-dollar loans. (Cigarette tax increase cut smoking less payment to states, harm bond repayment..)And the bill may have a few other unintended consequences that may be good for Big Tobacco. Shares of tobacco companies Altria Group (NYSE: MO), Reynolds American (NYSE: RAI), and Lorillard (NYSE: LO) moved slightly higher when the bill passed. Why? With limited new advertising, their more established brands will benefit.

And since the FDA is unlikely to ever approve new cigarettes, existing brands will benefit. Plus, the government will have the power to crack down on counterfeit cigarette sales, driving buyers into the hands of the big companies.

Tobacco companies have long been known as recession-proof. People who are hooked are unlikely to give up their smokes in hard times. A Merrill Lynch research report says tobacco companies have outperformed the Standard & Poor’s 500 index by an average 12 percentage points during the last six recessions!

So, here’s the irony: Restrict advertising, limit new smoking opportunities, and states have less money for health care, while tobacco dividends are perpetuated, making the stocks more attractive.

June 15, 2009 - Six of the world's foremost health agencies, collectively managing an estimated 80% of all public health research funding, today announced formation of a landmark alliance to collaborate in the critical battle against chronic, non-communicable diseases: cardiovascular diseases (mainly heart disease and stroke), several cancers, chronic respiratory conditions, and type 2 diabetes. The health impact and socio-economic cost of these largely-preventable diseases is enormous and rising, potentially derailing efforts at poverty reduction.

The Global Alliance for Chronic Diseases (Alliance) is being created to support clear priorities for a coordinated research effort that will address this growing health crisis, now reaching world epidemic proportions. Experts estimate that, unless action is stepped up, 388 million people worldwide will die of one or more such diseases within the next decade.Work of the Alliance will focus in particular on the needs of low and middle income countries, and on those of low income populations of more developed countries.

The Alliance's charter members are: * Australia National Health and Medical Research Council; * Canadian Institutes of Health Research; * Chinese Academy of Medical Sciences; * The U.K. Medical Research Council; and * The U.S. National Institutes of Health, specifically its National Heart, Lung, and Blood Institute (NHLBI), and the Fogarty International Center.The World Health Organization (WHO) is joining the Alliance as an observer to facilitate Alliance support for implementation of the World Health Assembly-approved "Action Plan for the Global Strategy for Prevention and Control of Non-communicable Diseases." WHO "Prevention and control of noncommunicable diseases: implementation of the global strategy".

The following research priorities have been proposed by some founding Alliance members, for discussion at their inaugural scientific meetings in November 2009:* Test ways to prevent cardiovascular diseases and complications of diabetes; * Identify and promote public health measures for controlling obesity; * Characterize and quantify the major risk factors for chronic obstructive airways disease (both tobacco and environmental pollution) and the development of control measures; and * Advance research into the problem of tobacco consumption and its relationship to cancer, cardiovascular disease and other disorders; * Develop interventions to address the above priorities.

June 15, 2009 - The new law that will prohibit smoking in bars and restaurants as of January 2, 2010, does not allow hookah (argileh nargile, hubble-bubble, water pipe, hooka, shisha, goza, meassel, sheesha) bars to continue to operate, and it needs to stay that way.

Hookah pipe use carries many of the same health risks as cigarette smoking, including being linked to lung cancer and other respiratory diseases. Hookah users expose themselves to dangerous levels of cancer-causing chemicals, hazardous gases and nicotine.

Hookah bars aim to attract the 18- to-24-year-old age group, and they are succeeding. These new hookah users are at risk for becoming habitual cigarette smokers; one study found that teen hookah users are eight times more likely to experiment with cigarettes.

The goal of this smoke-free legislation is to protect public health. Allowing hookah bars to continue to operate violates that goal.

Narace expressed concern over the high prevalence of cigarette smoking among the nation's youths in an address at the World No Tobacco Day Awards Ceremony hosted at the Ministry of Health's head office in Port of Spain. An award was presented to the Trinidad and Tobago National Tobacco Control Committee by the Pan American Health Organisation (PAHO) in recognition of its work in the fight against smoking.

Narace said a 2006 study administered by the National Alcohol and Drug Abuse Prevention Programme (NADAPP), in collaboration with the Inter American Drug Abuse Control Commission, that targeted national secondary schools and which covered 56 schools with a representative sample of approximately 4,000 pupils, showed that "more than one-quarter of all students surveyed reported having tried cigarette smoking".

"The annual prevalence was 11.4 per cent and the current use prevalence was a 5.6 per cent," which meant about one in every 18 students were currently smoking," Narace said. He said, according to the report, "not many students felt that smoking cigarettes sometimes was very harmful".

The report also showed that the "favorite location where cigarettes are most often smoked was surprisingly at home. Moreover most students overall indicated that cigarettes were first used at home (29.7 per cent). This was followed by "at a party" (11.4 per cent), "on the block " (10.4 per cent) or at some other location".

Narace warned of the dangers of smoking, pointing out that it could have devastating effects on one's health and caused a range of diseases. He said the Ministry of Health had drafted the Tobacco Control Bill which had been sent for a second reading in Parliament. Narace added the bill had been amended by a Joint Select Committee and would be reintroduced in the Parliament shortly, pending approval from the Cabinet.

June 14, 2009 - An anti-smoking group James Middleton, chairman of the anti-tobacco committee in Hong Kong for campaign group Clear the Air, said the poster for a film about Coco Chanel breaks laws banning any mention of smoking or cigarettes in advertising. Middleton: "It is a direct breach of the law."

The film "Coco Before Chanel," features the French fashion legend Audrey Tautou smoking a cigarette. In the poster, Tautou poses in silk pajamas with Chanel's trademark cigarette dangling from her fingers, has appeared across the city. No one from the company responsible for promoting the movie in Hong Kong, Lark Films Distribution, was immediately available for comment.Earlier this year, the company that runs advertising on trains and buses in Paris pulled a similar poster over fears it could be prosecuted.An advert for the film that appeared Friday in the South China Morning Post had the cigarette airbrushed out. Hong Kong's Health Department was also not immediately available to answer questions from AFP, but a spokesman told the South China Morning Post it was looking into the case.

Hong Kong anti-smoking laws ban any mention of smoking or cigarettes in advertising. I (Elmer W. Cagap) wonder if cigarette companies have been overtly promoting their products by coordinating with filmmakers to insert smoking scenes in the movie.